Inventory - is the goods and materials that a business holds for the ultimate goal of resale. Inventory management is a discipline primarily about specifying the shape and placement of stocked goods.
Samples of Inventory
Inventory refers to all the items, goods, merchandise, and materials held by a business for selling in the market to earn a profit. Example: If a newspaper vendor uses a vehicle to deliver newspapers to the customers, only the newspaper will be considered inventory. The vehicle will be treated as an asset.
Here are the Four Types of Inventory
1. Raw Materials
2. Unfinished Products
3. In-Transit Inventory
4. Cycle Inventory
What is the purpose of inventory?
Inventory is a valuable business asset. Businesses take inventory so they know how much they have on hand at a specific point in time. Inventory includes both finished products, work-in-process (products in various stages of completion), and products to be used to make new sales items.
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